Perspective: Morning Commentary for September 26

By: Mike Castle, Market Intelligence - Fertilizer Analyst

Fri, 26 Sep 2025, 13:27

September 26 – Stock futures are pointing to a positive open to kick off the Friday session, looking to recover some of the week’s earlier losses. The VIX is down slightly this morning after touching a three-week high yesterday, trading just below the 16.5 level. The dollar is in the same situation, down ~0.2% at the time of writing to trade near the 98.25 mark after reaching its own three-week high yesterday following the hotter-than-expected GDP and lower-than-expected unemployment data that bolstered the case of a more hawkish Fed. Treasuries are narrowly in the red this morning, with 10-year yields trading just below 4.17% and 2-year yields just below 3.65%. Crude oil is again in the green, looking to cap off a strong week amid a handful of Ukrainian attacks on Russian energy infrastructure that have led to reports of domestic shortages and subsequent restrictions on exports of some refined products, as nearby WTI trades to a three-week high near $65.40/barrel. The ags are largely mixed, with the grains still in a quiet, rangebound trade to end the week ahead of next Tuesday’s USDA report.

This morning’s much anticipated inflation data came in largely as expected, with headline PCE rising 0.2% month-on-month and 2.7% year-on-year in August, both marking 0.1% increases from the month prior but matching analyst estimates. Similarly, core PCE figures matched market expectations, rising 0.2% month-on-month and 2.9% year-on-year; with a 0.1% downward revision being made to the month-on-month figure, these both matched July. While all the above met market expectations, it is worth pointing out that this still suggests stubbornly sticky inflation, as the 2.7% year-on-year headline reading marks the highest jump seen since April 2024, up notably from the recent low of 2.1% put in back in April. Additionally, while core PCE’s 2.9% year-over-year rise was steady from the month prior, this is still higher than all of 2024 and the first half of 2025, highlighting the persistent price pressures and potentially signaling some amount of caution for the doves.

There were a couple of stronger than expected highlights from this morning’s release, however, with personal income rising 0.4% month-over-month, steady from July but beating analyst estimates of a slight dip to 0.3%. Personal consumption expenditure rose 0.6% month-over-month, above expectations of matching July’s 0.5% rise while marking the third consecutive monthly increase and reaching the highest reading since March. Following that thread, we’ll get a fresh update on consumer sentiment from the University of Michigan later this morning, with analysts anticipating the final September headline reading to be left unchanged at the preliminary 55.4; if realized, this would be the weakest final reading for the index since May.

Atlanta Fed President Raphael Bostic made headlines yesterday by discussing in a podcast appearance the potential for the Fed to move away from their 2.0% inflation target in favor of a targeted range, suggesting that 1.75% - 2.25% would be a “good start.” The conversation regarding the validity of the Fed’s 2.0% target has been ongoing for quite some time now, as U.S. inflation hasn’t been below the target rate in years (take PCE for example, which hasn’t been below 2.0% since February 2021). Even the Fed’s own projections don’t show headline or core PCE inflation (their preferred metric) getting back to 2.0% until 2028. The longer the Fed’s inflation target appears to remain unachievable, the more Fed skeptics can question their credibility, which has already been a hot topic in 2025 given the growing political pressure and anticipated turnover when Jerome Powell’s term as chair ends this spring.

A fresh round of tariffs was announced by President Trump yesterday evening, with the largest being 100% tariffs on imported pharmaceutical products. There is an added caveat, however, that the tariffs will not apply if the company is building a pharmaceutical manufacturing plant in the U.S., defined by the President as “breaking ground” or “under construction.” Pharmaceutical goods were the 5^th largest import to the U.S. in 2024, totaling roughly $212B, with much of the branded products coming from Europe and much of the generics coming from India and China. The furniture sector is also being targeted, with a 50% tariff being put in place on kitchen cabinets, bathroom vanities, and “associated products,” while a 30% tariff is being put in place on upholstered furniture. Finally, a 25% tariff is being put in place on imports of “heavy trucks,” with the President naming a handful of prominent domestic manufacturers that this measure is aiming to protect. All of the above tariffs are set to go into effect next Wednesday (Oct 1^st), but final details are still largely unknown. The most relevant question is whether these new tariffs will be on top of existing national tariffs, especially given the fact that some recent trade deals (E.U., Japan, U.K.) include language capping tariffs on specific products like pharmaceuticals.

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Perspective: Morning Commentary for August 7

August 7 – The U.S. economy unexpectedly lost 23k jobs in July, dramatically below market expectations of an 80k increase and marking the worst Non-Farm Payrolls print since February. Furthermore, May and June were both revised sharply downward, with combined revisions showing 103k fewer jobs than previously reported. Outside of the healthcare sector, which added 22k jobs in July, the losses were very broad-based. Government payrolls saw the largest decline, shedding 53k jobs in July, the largest seen since October 2025, while June was revised down to show a loss of 10k jobs as well. The private sector at least saw growth, adding 30k jobs in July, now matching the month prior after it was revised down from the 49k initially reported, and substantially missing forecasts of 78k jobs being added. This is a sharp reversal in course from the largely better than expected U.S. labor data seen earlier this week.

Mike CastleFri, 07 Aug 2026, 13:26

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Perspective: Mid-Day Commentary for August 6

August 6 – Stocks remain quietly mixed at midday as both the S&P 500 and Dow Jones remain just below their fresh all-time highs put in yesterday. This is allowing the VIX to cool to a four-week low below the 15.4 mark, reflecting the collective sigh of relief in the market amid largely better than expected U.S. economic data today. The dollar remains quietly in the green in its relatively tight range this week, trading at 99.9 at the time of writing. Treasuries remain elevated but have cooled from their recent peaks, with 30-year yields trading at 5.189%, 10-year yields trading at 4.647%, and 2-year yields trading at 4.229% at midday. Crude oil also remains quietly in the green, with nearby WTI up 2.3% on the day trading near $76.80 and nearby Brent up 2.4% on the day trading near $81.40. The ags remain mixed, with the wheat complex now squarely in the red while corn and soybeans cling to small gains, and the livestock complex largely pushes lower.

Mike CastleThu, 06 Aug 2026, 15:18

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Perspective: Morning Commentary for August 6

August 6 – This morning’s stronger-than-expected U.S. labor data offered markets some relief, reinforcing confidence in the economy while giving the Fed greater flexibility to raise rates should inflationary pressures reaccelerate in next week’s July data. Stock futures are pointing to a mixed open to start the day, with the tech-heavy Nasdaq showing the most weakness. The VIX has fallen notably from yesterday’s spike above 18.4 as it starts the day hovering just below the 16-mark. The dollar is quietly higher as it trades just above 99.8, holding in the tight range seen thus far this week as traders continue to digest data to shape expectations for the Fed’s next move, which we’ll dive into in more depth below. Long-term treasury yields have relaxed slightly from their recent spike, with 30-year yields starting the day trading just above 5.19%, while 10-year yields trade above 4.64%, and 2-year yields sit below 4.22%. Crude oil is modestly higher to start the session after sharp declines earlier in the week, with nearby WTI up 1.8% to trade at $76.40 and nearby Brent up 2.4% to trade at $81.40. Meanwhile, the ags are quietly mixed to start the day.

Mike CastleThu, 06 Aug 2026, 13:24

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